SENATE BILL NO. 86 "An Act relating to the sale or other disposal, leasing, or encumbrance of Alaska Railroad Corporation land; and providing for an effective date." 9:40:07 AM Co-Chair MacKinnon directed attention to SB 86. The committee had heard the bill on March 5, 2018. The public hearing was opened and closed. Multiple people testified, and the committee reviewed the fiscal note. There was a committee substitute currently before the committee. She asked for a motion. Vice-Chair Bishop MOVED to ADOPT proposed committee substitute for SB 86, Work Draft 30-LS0487\U (Laffen, 3/26/18). Co-Chair MacKinnon OBJECTED for discussion. JULI LUCKY, STAFF, CO-CHAIR MACKINNON, discussed the changes to the bill. She indicated that the Senate Finance Committee had brought up several concerns when the bill was first heard. The committee substitute was drafted to address those concerns. The first changes were on pages 1 and 2. Sections 1 and 2 were added and related to the retention of subsurface rights. It added these types of land disposals to existing law where the state retained the subsurface rights for various other land disposals. There was a 3-year sunset which was why there were 2 sections. The first section would put the section into law for 3 years in which the railroad would not have to have legislative approval. Section 2 would remove Section 1 from law once the 3-year period was over. Ms. Lucky reviewed the next change which was on page 8. The bill sponsor rewrote the current Section 14 to codify additional specificity in the requirements prior to the disposal of land and to place a few side bars on the public notice process. One of the requirements was to determine that land was not needed for railroad purposes and that the action was in the best interest of the state (currently in law). It would be reentered into the section of law that would be in place in the 3 years that legislative approval was not needed. She also reported that there would be a minimum public notice requirement of 60 days, found on line 14, and a requirement that adjacent land owners were notified in addition to any other public process on page 8, lines 18-19. Another change that was discussed in committee but had not been added to the bill at the time it was first presented was a limit of 90 days for the exercise of the right-of-first-refusal. There was also a sentence added to the section that specified that the right-of-first-refusal was extinguished the lease holder rejected it in writing. The railroad would not have to hold it over 90 days as long as all lease holders provided their rejections in writing. Ms. Lucky reviewed the next changes on page 9-10 of the bill. Section 17 and Section 18 were technical changes accidentally omitted from the first bill by Legislative Legal Services. Technical drafting errors were corrected in the current version. Section 17 placed the section into the bill, and Section 18 deleted language after the conclusion of the 3-year period. Ms. Lucky indicated that the final change that was made on behalf of the committee was the inclusion of Section 19 through Section 22 beginning on page 10 of the bill. There had been discussion about outstanding bond authority that the railroad had been granted over a period of a number of years. Much of the bond authority might have had sunsets, but there were 3 bonding authorities not needed by the railroad which the bill sponsor confirmed with the railroad. They sunset in the bill. She had reviewed all of the changes to the bill other than some technical clarifications that needed to be included. Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO further OBJECTION, it was so ordered. 9:44:49 AM AT EASE 9:45:10 AM RECONVENED Co-Chair MacKinnon asked if Ms. Moss had any comments on the CS for the committee's consideration. RYNNIEVA MOSS, STAFF, SENATOR JOHN COGHILL, stated that the sponsor was amendable to the bill moving out of committee with the changes. Senator McKinnon asked if Ms. Moss had contacted the Alaska Railroad earlier to inform them the CS was being introduced. Ms. Moss responded that she had contacted Tim Sullivan earlier in the morning. Co-Chair MacKinnon OPENED and CLOSED public testimony. Vice-Chair Bishop MOVED to report CSSB 86(FIN) out of Committee with individual recommendations and the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSSB 86(FIN) was REPORTED out of committee with a "do pass" recommendation and with one zero fiscal note: FN 1(CED). Vice-Chair Bishop noted that the zero-impact fiscal note had been reviewed previously. 9:47:09 AM AT EASE 9:50:06 AM RECONVENED Co-Chair MacKinnon relayed that the committee had been having a brief discussion on the following day's meeting. She cancelled the Wednesday afternoon meeting scheduled for the following day and would see if there was anything the committee could prepare for the following morning's meeting. She discussed the agenda for the following day.